The performance of the U.S. stock market this year has been varied depending on which ETF you look at. The SPDR S&P 500 ETF Trust (SPY) has gained 18% so far this year, reaching record highs. On the other hand, the SPDR Dow Jones Industrial Average ETF Trust (DIA) has only seen a 5.1% increase, similar to the Invesco S&P 500 Equal Weight ETF (RSP) which has gained 4.7%. The iShares Russell 2000 ETF (IWM) has only seen a 0.9% return.
These differences in performance among various ETFs reflect the current market environment, where megacap tech companies have been favored. For example, Nvidia alone has boosted SPY’s return significantly. On the other hand, high interest rates have impacted the profitability of smaller companies in the Russell 2000 index, such as those in IWM.
The Dow Jones has historically been a decent indicator of the overall stock market performance. DIA’s return matches that of RSP, which tracks an equal-weighted version of the S&P 500. The gap between SPY and RSP is currently significant, raising questions about which ETF is a better representation of the U.S. stock market.
While the traditional S&P 500 tracked by SPY is widely followed, the outperformance of certain stocks may lead investors to question whether it truly reflects the overall market. The debate over which ETF is more indicative of the U.S. stock market continues.
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